Invesco, a $364 billion ETF manager has become the latest institutional giant to file for a Bitcoin ETF in the US. The ETF manager filed for a Bitcoin Strategy ETF under Act 40 with the US SEC. The said ETF would hold Bitcoin Futures, Grayscale’s $GBTC shares, and Canadian Purpose Bitcoin ETF. Invesco already operates 233 ETFs in the U.S.
The Bitcoin Strategy ETF would not directly invest in Bitcoin and rather focus its investment towards the futures market. The official filing read,
“The Fund is an actively managed exchange-traded fund (“ETF”) that seeks to achieve its investment objective by investing all or substantially all of its assets in exchange-traded futures contracts on bitcoin and Collateral investments (as defined below). The Fund will not invest directly in bitcoin. The Fund may also invest to a lesser extent in exchange-traded products (“ETPs”) and private investment trusts traded over-the-counter that provide exposure to or directly hold bitcoin (collectively, the “Bitcoin-Related Assets”).”
Bloomberg ETF Analyst Predicts More ETF Filings on its Way
Bloomberg ETF analyst Eric Balchunas pointed towards the time of ETF filing which came in the early morning at 6 am and predicted another 5-10 ETFs filing could be on its way by Friday evening. He also went on to draw attention towards the 1940 Investment Company Act under which Invesco filed its Bitcoin ETF claiming it might have been done to please the SEC chief Gary Gensler. He also claimed SEC’s focus on Act 40 could deter ETFs from holding Bitcoin directly.
Invesco filing for a Bitcoin Strategy ETF under 40 Act (to satisfy Gensler) that will hold futures, $GBTC and Canada bitcoin ETFs. Rare 6am filing = rushed it out. Won’t be surprised if we see 5-10 of these by Friday night. pic.twitter.com/S0pMtOKwYJ
— Eric Balchunas (@EricBalchunas) August 5, 2021
“Basically, the SEC’s hang-up w 40 Act could end up funneling billions into derivatives, $GBTC (which is a major reason ETF needed!) as well as up north into another country when the ppl just want an ETF that holds bitcoin directly.”
1940 Investment Company Act offers regulation for closed-end funds and mutual funds that ensures investor protection. Gensler in his recent series of interviews has called for better investor protection laws around the crypto market and also hinted that a Bitcoin ETF would come with strict regulations.